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ANJALI RAO, CNN HOST: Back stage it's the usual fashion frenzy, but for the first time, the latest trends are being flaunted on the walls of one of China's most recognized sites. And this is the man behind it. Rolling out his eponymous label just five years ago, Phillip Lim's award- winning designs are now not only a staple of the young and fabulous, but revered by celebrities and critics alike.

His classy, cool, pragmatic style and promise of affordable luxury has shaken up the New York fashion scene. It's also seen him join a wave of Asian-American designers climbing the fashion ladder. This year, his label is expecting to rake in a cool $60 million. It's no surprise, then, that "Fortune Magazine" now considers him one of the top 40 young business people of 2010.

This week on "Talk Asia", we go back stage at Phillip Lim's first ever Beijing fashion show and spend some time with the designer, who promises to be the next big thing in vogue.

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RAO: Phillip, welcome to Hong Kong. It's great to have you on the show today. Now, this is the fifth anniversary of "3.1 Phillip Lim". From very modest beginnings, you now have 400 stalls worldwide?

PHILLIP LIM, FASHION DESIGNER: Yes. In 50 countries. And we also are opening our fifth store in Singapore.

RAO: So, how do you view your position, then, on the global fashion stage?

LIM: I am just a student -- taking it all in and, you know, taking notes and doing my homework. And, you know, I think, if we think about five years in human term, we're just toddlers, you know. And we're grateful to be in this position, but at the same time, every year, every moment is a learning experience.

RAO: How have you managed it, though, when so many others have fallen by the wayside? The road to fashion greatness is littered with corpses.

LIM: Fashion victims. No. You know, I think people are asking me "what is the secret?" And the secret is, there is no secret. You know, for myself, my personal journey has been a very fortunate one and I would say to people it's like the stars lined up and the skies opened up and the sun shined and I met the right people -- was at the right time. And, most importantly, you know I love what I do.

RAO: It's impossible to ignore this wave, at the moment, really, of Asian-American designers who are coming to the fore. I mean, of course, there's you and there's Jason Wu and Alexander Wang and Thakoon, among so many others. What do you think that is? I mean, is it something about the Asian work ethic? What is it?

LIM: I think the Asian work ethic is -- it definitely plays a part in just that drive. But I think Asian society and Asian culture, you know, it's very aesthetically driven. You know, I think we've always been in fashion, just behind the scenes and I think, you know -- it's interesting because I'm always getting this question too. And we come from such different paths and we took different roads to get there and it just really happened to be coincidental in the timing for this rise, if you will.

I think, really, it is deep-rooted in a culture that is very -- that places visual aesthetics as a priority. Face, as they say.

RAO: You are ethnically Chinese, born in Thailand.

LIM: Yes.

RAO: When you come back to Asia, does it stir something in you?

LIM: Yes. It's so emotional, you know? I think my parents were immigrants, you know, so I guess I would be first generation. Growing up in California. And, you know, I grew up in a duality where day was Western culture and then at night, it was completely Eastern culture and I grew up fighting my Eastern heritage -- my Chinese side.

And, as I get older, I have this innate yearning to, you know, just realize my roots and get deeper in touch with it. And, you know, every time I come to Asia, I'm just inspired, in awe, and just -- I feel at home.

RAO: It's been a long time since you actually lived in Asia, though. When you were very, very young, your parents took you to Cambodia until the war broke out there, even though you were so little. Have they told you much about that time?

LIM: No. Until recently, actually. I think three years ago at Los Angeles Times, they wanted to do a Mothers' Day article and it was the editor, Booth Moore -- I was telling her about my -- she was asking me about my upbringing and I was like, you know my mother was a seamstress and she worked in factories, and she was like, "Wow, do you mind if we do a Mothers' Day article on her?"

They sent a crew to her house in, you know, Orange County, where it all began and, you know, she started to kind of go into the history of just escaping the wars and the refugees and having all the kids on a canoe. Just getting them to safety and the whole room was in tears because I never knew what it took for me to have this opportunity. And now it's payback, I guess, you know? My mother has become my daughter and I've become her guardian.

So, being here in Asia and doing the show in Beijing -- it's a huge, huge honor. Not only professionally, but personally. Because she's also never been to any of my fashion shows.

RAO: That's amazing. How has she never been?

LIM: You know, I think it comes back to that Asian cultural aspect where you're never good enough. You know what I mean? It's like an "A" is not good enough, you have to be an "A+" and I've never felt ready to receive her and she is from China, so the best first chance is to bring her back to where she came from and realize that -- look what your hands did.

RAO: When the family fled Cambodia, you ended up in the U.S. What was the allure of America?

LIM: I think, as with any immigrants, you know, it's the possibilities and, you know, you come here and maybe you can make something of yourself, you know? I'd never take anything for granted. It's really taught me that point -- that value.

RAO: And, I think it's really interesting where your dad is a professional poker player.

LIM: Yes. He was. He did many jobs and -- but I always remembered him so elegant, you know, he had a very specific way about him. The things that -- what he smoked, what time of day he woke up, the way he would dress. And so, he's very eccentric and my mother was the conservative one. And so, I think I have that combination of my mother and my father.

RAO: So, with your mum being a seamstress, then, how much did he bug her?

LIM: Constantly. Constantly. I would bring home second hand clothes or new clothes and take it apart and tell her to, like, OK, adjust it like this, please adjust it like that, and she's like, "These are new clothes, you're crazy. Do you know how much this costs?" But, in the end, she would humor me. Also, again, I think I 'm her favorite, that's why.

I'm her baby, the youngest. It was just that kind of a relationship growing up and I went to school as a business major because, you know, growing up, the only thing you could do was be a doctor, lawyer, engineer, or businessperson. And I chose business because it was, like, more general and maybe the least of the evils. Specialize and I could figure out what I wanted to do.

And three years of studying at business, I dropped out. Because I just realized that this is not for me, you know, I can't live this lie, you know, so I stepped down.

RAO: It took you three years to work that out?

LIM: Yes. Took me three years. Just because -- you know, again, it goes back to home values. You know, it's like you had to save face and, you know, my mother -- I remember breaking the news to her that I'd dropped out of business school to take sewing classes. Wow, water works. But I didn't tell her that until I graduated with a BA in home economics.

RAO: Didn't the deception drive you mad?

LIM: Oh God, oh God, it goes back to the guilt, you know? It was insane. It was leading a double life, you know? But I had to pursue this. I didn't know why, it was very innate. It was this force that I couldn't stop. So, I took an internship course just to finish my degree.

At least, I figured, OK, as long as I have a degree, I could be stamped as somewhat intelligent and educated, you know, no matter what it was in. And, you know, I got the internship course at Katayone Adeli -- two weeks later, they hired me.

So, I did that, and then I broke the news to my mother, my parents and she was just in tears. You know, we -- it was a moment when our relationship kind of separated. Finally, you know, fast forward maybe four years ago, only. Until relatives in Paris -- they phoned her. They were like, "Do you realize your son is in the papers in France?" And she was like, "What?".

Yes. So I kind of kept it a little secret.

RAO: What an amazing story.

Coming up, we find out how Phillip Lim and his partner broke the mold and into the fashion world.

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LIM: Over here, we have a couple looks from the 2011 show. This look here is an idea -- I'm using silk and polyester and using technology to give that sense of armor to something as delicate as silk. This trench coat -- the take of a classic trench coat that we did it in organza that's light as a feather.

This look here is about layering geometric planes and patterns. Kind of, when you're looking at it, you're like where does it end? Where does it begin? Is it one piece? Is it three pieces? So, that's the whole idea of what I'm trying to do with clothing.

RAO: So, when you took up the internship at Katayone Adeli, you stayed there for a couple of years.

LIM: Yes, yes.

RAO: And you've spoken of it as being particularly grueling.

LIM: It was grueling and also -- you know, mind you -- at that point I didn't want to be a fashion designer. I didn't know what the fashion designer was. I just wanted to be immersed in the surroundings. I was a great support system of just making things work and making things happen. So, it was really a great instructional life course of how to get it done. You know, and it was just -- I played the role of support.

RAO: And, after that, you were poached by Development?

LIM: Yes. Actually, poached by friends to start Development.

RAO: To start Development.

LIM: And Development was something I started with partners. It was - - Development was a development from my mind, you know? And, again, I fought that, also, because I was like, I'm not -- I'm the wrong person. I'm not a fashion designer. I only work in a studio. That's it.

And it was so difficult to, like, actually actualize the fact that you could take pen to paper and sketch something, because I've never done that before in a real life setting. I finally broke free and, you know, sketched the first 30 pieces to a collection.

And, you know, it went to market and I remember all of us having second -- real, like, day jobs while we were doing this at night in a garage in Newport Beach, California. And we were saying, "OK, if the first sales order was more than $3,000, we're all going to quit the day job and pursue this".

And it was with American Rag - Japan. And it was $30,000 and $30,000 as a first order in 2000 -- the year 2000 -- that was phenomenal, you know? And that kind of launched my career as a professional fashion designer.

RAO: It did become this, sort of, you know, cult favorite.

LIM: Yes.

RAO: And you were there for five years?

LIM: There for five years and, at the end, you know, we had creative differences, you know, from my business partners. And then -- how did -- we broke up. You know, I was unemployed for the first time in a long time.

RAO: You weren't jobless for long, though. Because by then, you'd met Wen Zhou, who was --

LIM: Yes, I met Wen and we were friends, and we had no idea that we would start this company that we now have -- 3.1 Phillip Lim. I remember, after walking away from my company -- going home, you know, having a beer, watching Oprah.

I was available in the daytimes. I had free time. It was strange. And she's like, "What are you doing?" I'm like, "Oh, I'm just watching Oprah". And she's like, "Oh, why don't you come out, come shopping with me, you know, just take your mind off things."

And she was living -- she lives in New York. And it was -- that was a Monday and she goes "I have a ticket for you for Thursday, the same week, and it will be a one-way ticket so you can come back any time you want".

And I'm like, "OK, I have nothing to do anyways." That weekend, she convinced me to stay in New York and start a business. And I don't know why I agreed, but I guess she was quite a force. You couldn't say "no" to her.

RAO: One says that her accountant thought you were both completely bonkers.

LIM: Yes.

RAO: Did you question your sanity?

LIM: I agree with him. I agree with him. But, again, I think that it takes kind of crazies to really do anything. But, you know, no guts - no glory. And I think we were young-ish, or younger -- we were 31, so, at that time, too, you know, you're kind of naive because, again, we had no expectations. We didn't come from heritage, we didn't come from working for famous people. It was just this desire to create clothes that were beautiful, but accessible.

RAO: So, you knew the accountant thought that you were off your rocker. You did actually manage to get into profit territory after about six months.

LIM: Yes.

RAO: Did you expect it to happen quite so fast?

LIM: No, but my -- if you ask Wen, she would say, "Yes". I mean, she's a brilliant businesswoman. It's like, talk about powerhouse. And, you know, it goes back to just the innate instinct to survive. And that's a secret, you know. It was just like we had to make sure we were going to go into this head first, but have realistic expectations and something to fall back on, you know? So what's how we proceeded. And, you know, we were profitable in the first six months.

RAO: Most designers do sort of cater to this, "if you have to ask, you can't afford it", you know, section of the market. Can you ever see yourself wanting to go ultra high-end? I mean, not necessarily entirely, but have a very high-end side of the business?

LIM: No. I can say that through-and-through. Just because, again, it goes back to my values. You know, it goes back to where I come from. And you think about, you know, dresses costing $5,000, $10,000, $20,000 -- some families don't even make that in a year. You know, can you imagine, like, you'd have to make that decision -- do I buy a dress or do I feed a family?

It's kind of crazy, you know, and, again, I think that it goes back to -- just because it costs a lot doesn't necessarily mean it looks good and it's stylish. You know, I think that style is, you know, in essence it is a natural way of being, you know? I think that you can make a t-shirt super stylish, you know. You can make jeans and a t-shirt super stylish. It's what you make of it, you know?

RAO: What are you like in the run-up to the showing of a new collection or a huge runway show?

LIM: I am nervous, you know what I mean? I am happy, I'm sad. You know, it's all these emotions because, again, it's like I always -- people are always saying, "You must get used to it by now, it must be so simple". I'm like, "No, it is like the first collection." And I feel like it might be the last after I keep looking at it like, what is this? What did we do? It's horrible, it's a disaster.

But, again, I think that it's the combination of being naive and using that as having fresh eyes and being -- keeping that intensity and keeping it honest that kind of makes every season feel new, you know, and keeps us going.

RAO: So, how involved are you on a day-to-day basis with the business?

LIM: As they say, I'm in the trenches. Every day I'm involved. You know, I don't know how the day plays out from sketch, to execution, to production, to strategies, to marketing, to PR, to human resources, you know? We are a five-year-old business that is still learning and, you know, will always learn, I hope.

And it's a young company, so we're just finding our way. It's a simple partnership. We're not backed by anybody. We're independently owned, so we really do or die by the dress.

RAO: And how do you deal with it if you do have a "bad season"?

LIM: I haven't had to deal with it yet, thank God. I don't know. I don't know how you would deal with it. But I think I'd go into it with that thought already, so it's almost preparation.

RAO: Was the industry automatically accepting of you?

LIM: They were shocked and awed, you know? As they say in war, maybe. They were shocked because they didn't know what to make of it. They didn't know what to call it. They were like, "Is it designer? Is it contemporary? It looks designer, but the prices -- you know, we can't put it here, we can't put it there."

RAO: Exactly.

LIM: You would hold up a trench coat, and it was, like, $700 and it was -- like, 50 percent of it was handmade in the most beautiful Italian fabrics. You couldn't deny the force of that, you know? And aesthetically, it was pleasing, so it was really embraced. One of the first players -- Barneys New York -- and I remember the first season they gave us the Madison store windows, and they never had done that before for a young designer before.

And I remember one time walking up Madison Avenue and looking up and seeing my name on these windows and all these mannequins dressed in the collection, and it was literally like a kid facing the biggest gumball machine ever. You're like, wow.

RAO: Didn't you used to unpack boxes at Barneys on the weekends?

LIM: Yes. I had a job as sales and stock.

RAO: And now they can claim you as one of their own.

LIM: Yes, and they do.

(LAUGHTER)

LIM: I love Barneys, though. It's a great place.

RAO: The queen of the fashion journalism world is, of course, Anna Wintour and she thinks you're a bit fab.

LIM: I think she's fab.

RAO: Her support of you must just be invaluable.

LIM: Yes, yes. And I think for any young designer, you know, and having Anna Wintour's support is quite an accolade. You know, she is the best of the best and she -- she's Anna Wintour for a reason.

RAO: She is painted as this terrifyingly aloof dragon lady. What is she really like?

LIM: She's busy. She's a professional. She's busy. She's great at what she does. You know, she's as -- if we were to break it down, she's an editor to the extreme. So, it's about that keen eye.

RAO: There's no shortage of celebrities who love getting around in your creations -- Demi Moore, Natalie Portman, Scarlett Johansen -- just to name a few of them. How does it make you feel, though, when you open up a magazine or you switch on the telly, and there is somebody extremely famous wearing something you've made?

LIM: I'm honored. You know what I mean? I think that the idea that they chose that to wear -- chose our creations to wear -- it's very -- it's a big compliment. For me, it's about the everyday woman, it's about the everyday man. I find it more interesting when I spot a person in the street or am next to someone wearing what we've made, you know?

I want to ask them a million questions. I wish I could go up and ask her name and --

RAO: Well, you should just go up and say, "Oi, I made that".

LIM: I can't do that. I'd rather say, "Oh, nice dress" or "nice blouse" or "nice pants". But then I would seem kind of pervy.

(LAUGHTER)

LIM: But I just find it fascinating of, you know, why they chose that.

RAO: I know that fashion week in New York has really only just wrapped up, but are you already working on new things?

LIM: Yes we are. We work in the past, the present, and the future, you know? We just wrapped up Spring 2011 shows, you know, and now I'm working on Summer, pre-Fall, Fall men's, Fall woman's of 2011, so --

RAO: It never ends.

LIM: It never ends. In any moment of time, we're working on three to four collections and it's like, "Is it summer? Should I be in bikinis or should I be in a winter coat, you know?" So, it's kind of separating and conquering.

RAO: Phillip, thank you so much for spending time with us today, I really appreciate it.